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Ethiopia and Eritrea are no longer at war, the neighbours said in a joint statement Monday, a day after their leaders held a historic meeting in Asmara.

Quoting from a "Joint Declaration of Peace and Friendship," Eritrean Information Minister Yemane Gebremeskel said on Twitter the "state of war that existed between the two countries has come to an end. A new era of peace and friendship has been ushered (in)."

"Both countries will work to promote close cooperation in political, economic, social, cultural and security areas," Yemane added.

He said the agreement was signed by Ethiopian Prime Minister Abiy Ahmed and Eritrean President Isaias Afwerki on Monday morning at state house in Asmara.

Images of the ceremony showed the two men sharing a wooden desk, backed by their nations' flags, as they simultaneously signed the document.

The declaration echoed comments made by Abiy at a dinner hosted by Isaias late Sunday, where he said diplomatic, trade, transport and communications ties would be re-established and borders reopened.

Recent weeks of rapid rapprochement are aimed at ending decades of animosity, periods of outright conflict and many years of cold war between the two countries.

The thaw began last month when Abiy said Ethiopia would abide by a 2002 UN-backed ruling, made after a two-year frontier war, and hand back disputed border territory, including the flashpoint town of Badme, to Eritrea.